WORLD TRADE ORGANIZATION

KANIKA SHARMA

ASSISTANT PROF. IN COMMERCE

WORLD TRADE ORGANIZATION

• International organization which regulates the international trade
• Officially commenced on 1^st January 1995 under the Marrakesh agreement.
• Signed by 123 nations in 1994
• WTO had replaced GATT (General agreement on tariffs and trade)
• They deals with: agriculture , textiles and clothing, banking, telecommunications , government purchases, industrial standards and product safety, food sanitation regulations, intellectual property and much more.

• It is the place where the member country comes and talks together and shares their grievance in order to resolve their problem related to international trade.

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• The countries make their decisions through various councils and committees, whose membership consists of all WTO members.
• The system helps promote peace, by handling dispute of member country it provide free trade which cuts the costs of living and provides more choice of products and qualities and stimulates economic growth
• WTO deals with the special needs of developing countries as two third of the WTO members are developing countries and they play an increasingly important and active role in the WTO because of their numbers, because they are becoming more important in the global economy.

WTO: THE BEGINNINGS

• The world trade organization (WTO) came into being on January 1^st 1995
• GATT(General agreement on trade and tariffs)was the earlier agreement which countries used to follow, it came into force on 1 January 1948. And it was signed by 23 nations.
• But it was replaced by WTO because it deals only with policy relating to goods and it also destabilized small and traditional economy, but WTO covers services and intellectual property as well and it has a wider scope.

FACT FILE OF WTO

Location - Geneva, Switzerland

Established -1^st January 1995

Created by - Uruguay Round Negotiations (1986-94)

Membership - 164 nation countries

Head – Nagozi Okonjo (Director General)

Secretariat staff - 625

WHY WTO?

• To arrange the implementations, administration and operations of trade agreements.
• Settlement of disputes.
• To make affectively and efficiency the trade policy review mechanism.
• To create more together relationship with all nations in the respect of global economic issues .

STRUCTURE OF WTO

FUNCTIONS OF WTO

• Administering WTO trade agreements.
• Forum for trade negotiations.
• Handling trade disputes.
• Monitoring national trade policies.
• Technical assistance and training for developing countries.
• Cooperation with other international organizations.

Principles of WTO

• The Basic Principles of the WTO (according to the WTO).
• Trade without discrimination.
1. Most favored Nation (MFN) : Treating other people equally.
2. National Treatment : Treating foreigners and locals equally.
• Freer trade: gradually, through negotiation
• Predictability: through binding and transparency
• Promoting fair competition
• Encouraging development and economic reform.

ROLE OF WTO

• The main goal of WTO is help the trading industry to become smooth, fair, free and predictable.
• It was organized to become the administrator of multilateral trade and business agreements between its member nations.
• It supports all occurring negotiations for latest agreements for trade .WTO also tries to resolve trade disputes between member nations.
• Multi-lateral agreements are always made between several countries in the past. Because of this , such agreements become very difficult to negotiate but are so powerful and influential once all the parties agree and sign the multi-lateral agreement. WTO acts as the administrator. If there are unfair trade practices or dumping and there is complain filed, the staff of WTO are expected to investigate and check if there are violations based on the multi-lateral agreements.

DISPUTE SETTLEMENT

THERE ARE 2 MAJOR WAYS TO SETTLE THE DISPUTES:-

1.MUTUAL AGREEMENT:-

FIRST AND THE MAIN WAY IS BY CONSULTATIONS BETWEEN THE PARTIES IF THE PARTIES FIND MUTUALLY AGREED SOLUTION THEY FOLLOW IT AND DISPUTE IS SORTED OUT.

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2.ADJUDICATION BY PANELS :-

ADJUDICATION MEANS A FORMAL JUDGEMENT ON A DISPUTED MATTER THAT THE APPELLATE BODY OF WTO REPORTS AND BOTH THE PARTIES HAS TO FOLLOW THE ORDER.

THE RELEVANCE OF WTO

• The system helps promote peace.
• The system allows disputes to be handled constructively.
• A system based on rules rather than power makes life easier for all.
• Free trade cuts the cost of living.
• It gives consumers more choice and a broader range of qualities to choose from.
• Trade raises incomes.
• Trade stimulates economic growth and that can be good news for employment.
• The basic principles make the system economically more efficient , and they cut costs.

THE AGREEMENTS

• The WTO is ‘rule-based’; its rules are negotiated agreements.
• Overview: a navigational guide.
• Further changes on the horizon, the Doha Agenda
• Some of the agreements of WTO
• - Tariffs: more bindings and closer to zero
• - The agriculture agreements: new rule and commitments
• - Textiles: back in the mainstream
• - Intellectual property: protection and enforcement

THE AGREEMENTS

• The agreements covers five broad issues:

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• How basic principles of the trading system and other international intellectual property agreements should be applied
• How to give adequate protection to intellectual property rights
• How countries should enforce those rights adequately in their own territories
• How to settle disputes on intellectual property between members of the WTO
• Special transitional arrangements during the period when the new system is being introduced

RECENT ISSUES

• India and China have called upon World Trade Organization (WTO) members to address long-pending concerns over public stockholding and special safeguard measures, to check against surge in farm imports, on priority, as member countries sought to bridge differences ahead by a meeting. 
• The Ukraine war has led the World Trade Organization (WTO) to cut its global trade growth forecast for this year. The previous 4.7% growth forecast has been cut to 2.5% due to "the impact of the war and related policies", said WTO boss Dr Ngozi Okonjo-Iweala.
• The cut is also linked to continuing global supply chain problems that started as a result of the pandemic. She said disruptions would make food more costly, saying "my worry is that we have a food crisis that is brewing". Dr Okonjo-Iweala told the BBC that although Russia and Ukraine only make up about 2.5% of global merchandise exports, they "are very, very significant in certain sectors".

THANK YOU